The prevailing COVID-19 pandemic caught nearly everyone off-guard, from individuals and institutions to governments. As much as we try to encourage optimism during these difficult times, unfortunately, all indicators point to a short-term global recession if the situation persists. One of the earliest predictions on the economic outcome speculated that the world economy would lose around $2.7 trillion to the outbreak in unrealized business output.
SMEs (Small and Medium-Sized Enterprises) have taken some of the hardest blows following this economic downturn. This fragile financial sector is particularly vulnerable to disruptions in the labor market, supply lines, and external infrastructure. Many SMEs across some of the most affected countries have already shut down their operations completely due to a lack of coping mechanisms and resources.
However, there are valuable lessons that every business leader and entrepreneur could learn from all this, particularly on disaster preparedness and surviving through crises. The main takeaways include:
An Effective Business Continuity Plan Is Essential
A recent study on business response to the COVID-19 outbreak revealed that more than 51 percent of businesses were not prepared to face the pandemic. A continuity plan ensures that at least the most vital business processes remain operational during an emergency. The lack of a business continuity plan or any effective response strategy is a recipe for disaster when hit with a crisis – many entrepreneurs are learning this the hard way.
Some institutions only began formulating their continuity plans during the onset of national lockdowns and the collapse of most business utilities. For many, the go-to solution was to digitize collaboration among remote employees to get things moving again. Microsoft’s CEO reported that the tech giant witnessed two years’ worth of digital transformation in just the months of March and April, mostly in the adoption of telecommuting tools and cloud services.
Sadly, many businesses are still struggling to remain active amid the pandemic, while those that got a head start by following well laid out plans are still forging ahead and even thriving.
Reinvent the Business When Continuity Is Impossible
With the pandemic in full swing, many companies have suddenly lost the market for their products and services. Unsurprisingly, the current demand mostly comprises of COVID-19-related items and essential supplies. For this reason, many organizations have swiftly reconfigured their product and service offerings to supply PPEs, foodstuffs, hand sanitizers, and a range of remote services.
Here are a few examples of businesses that have successfully reinvented themselves to satisfy these temporarily urgent demands.
Businesses that cannot proceed with their normal operations during a crisis need to device innovative adaptations to open up alternative revenue streams. The success of readjusting, mobilizing staff, and rewiring the business model comes down to the entrepreneur’s leadership skills and ability to identify and capitalize on fleeting opportunities.
Keep Your Eyes on the Future
Despite their uncertainties, crises eventually pass, and the current pandemic is no different. In business, it is never too early to start planning for the future. Organizations should consider how the current pandemic will change the social and economic business environment in the long term. For instance, consumer behavior in some niches is likely to change after the pandemic. In preparation for a post COVID-19 world, businesses should anticipate new market demands and modify their products and services accordingly.
We are seeing many businesses emphasize long-term competitiveness and relevance by keeping marketing campaigns alive, upskilling their staff through online courses, and gathering valuable customer insights regarding future preferences.
Surviving a global economic crisis calls for a high level of agility, readiness, and an instinct to spot opportunity in adversity. Some entrepreneurs can learn a lot from observing how some institutions are successfully coping with the current pandemic. The key point is that every business needs a proactive continuity plan and an open-minded approach to handling disasters. It is also important to prepare for recovery so they can hit the ground running once things begin to normalize.
Hopefully, more entrepreneurs will emerge from this crisis with a deeper understanding and appreciation for risk management and disaster responsiveness and recovery.
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Oli is a working mum who has a passion for teaching and all things educational. With a background in marketing, Oli manages the digital channels and content at Courses.com.au.